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SB17-157

Construction Defect Actions Notice Vote Approval

Concerning prerequisites for the authority of a unit owners' association to pursue litigation involving alleged construction defects, and, in connection therewith, imposing notification, disclosure, and voting requirements prior to commencement of an action.

Session:

2017 Regular Session

Subjects:

Civil Law

Housing

The bill requires that, before the executive board of a unit owners' association (HOA) in a common interest community brings suit against a developer or builder on behalf of unit owners, the board must:

Notify all unit owners; and

Except when the HOA contracted with the developer or builder for the work complained of or the amount in controversy is less than $100,000, obtain the approval of a majority of the unit owners after giving them detailed disclosures about the lawsuit and its potential costs and benefits.

The bill also limits the amount and type of contact that a developer or builder that is potentially subject to a lawsuit may have with individual unit owners while the HOA is seeking their approval for the lawsuit.